DRAM industry likely to face oversupply in 2019

[Nelly]

While the global DRAM market still remains robust currently, the recent capacity ramps by Micron Technology and the planned kick-off of commercial production by China-based Fujian Jin Hua Integrated Circuit and Innotron Memory (previously known as Hefei ChangXin) could lead to oversupply for the memory in 2019, according to industry sources.

Samsung Electronics and SK Hynix would be forced to overhaul their current profit-oriented business strategy as both firms believe that the booming memory market, which has continued for 2-3 years, is likely to be over by the end of 2018, according to a Korea-based Digital Times report.

Although Samsung and SK Hynix both stated, at their latest investors conferences, respectively, that they will continue to ramp up capacities for memory chips, the aggressive moves by rival companies have made the two companies hesitate, said the report.

Samsung has seen its share in the DRAM market continue to dive after hitting a high of 50.2% in the third quarter of 2016 as rivals including Micron have jacked up their revenues and profits.

Notably, Micron has ramped up its operating margin to as high as 50% so far in 2018 compared to 20% at the end of 2016. Additionally, Samsung saw its share in the market drop to 44.4% in the first quarter of 2018, while Micron managed to ramp up its share to 23.1%, according to IHS Markit.

The global DRAM market is expected to reach a peak of US$104 billion in 2018, before contracting by 1.8% and 2.6%, respectively, in 2019 and 2020, according to an industry estimate. Meanwhile, automotive applications will gradually replace the smartphone sector to become the largest market for memory chips.

Meanwhile, Micron is gearing up to expand production of 10nm-class DRAM chips at its Taiwan-based fabs between 2018 and 2019.

Micron's factory site in Taoyuan, northern Taiwan will enter 1Xnm chip production in the second half of 2018 and will migrate to 1Ynm process node at the end of the year, Digitimes reported earlier.

Additionally, Micron's factory site in Taichung, central Taiwan will transition to a newer 1Znm process in the second half of 2019 after already kicking off volume production of 1Xnm products.

In China, Jin Hua's 12-inch fab is expected to enter trial production of 20 or 30nm DRAM chips in September. China's recent move to protect its own memory industry by imposing partial sales ban on Micron's products in China could also affect the future development of the industry.

Having unveiled its engineering samples of 19nm 8Gb DDR4 products recently, Innotron is also expected to begin mass production for the chip in the first half of 2019.

In response to mounting competition, Samsung plans to kick off volume production of its 10nm LPDDR 5 chips at its fab in Pyeongtaek in 2019 and start its wafer foundry business in 2020 using a 3nm process. SK Hynix is expected to complete its development of LPDDR 5 chips in early 2019.

Source

 

[LabR@t]

Cheap ram? If so I might finally upgrade.

 

[CAT-THE-FIFTH]

Don't worry they are already saying GDDR6 is causing issues,or a Moose contaminated the clean room,or something,so expect RAM pricing to stay high especially if you want anything around 3000MHZ and higher.

 

[kitfit1]

None of the above makes a blind bit of difference to the market as it is now. It may well not make that much difference for quite a way into the future to us as overclockers. Does anyone seriously think that a newcomer to the dram market is going to come out "all guns blazing with seriously fast ram with nice tight timings" ..............i don't think so. The only thing it will do is make cheap ram, cheaper.

 

[Doogles]

None of the above makes a blind bit of difference to the market as it is now. It may well not make that much difference for quite a way into the future to us as overclockers. Does anyone seriously think that a newcomer to the dram market is going to come out "all guns blazing with seriously fast ram with nice tight timings" ..............i don't think so. The only thing it will do is make cheap ram, cheaper.

Honestly if they flood the market with that then at least people can get into the PC market, being able to buy RAM in 2012 for under £30 for 8GB was nuts, if you could do that now for Ryzen people could game (albeit only lightly) for under £200.

 

[CAT-THE-FIFTH]

None of the above makes a blind bit of difference to the market as it is now. It may well not make that much difference for quite a way into the future to us as overclockers. Does anyone seriously think that a newcomer to the dram market is going to come out "all guns blazing with seriously fast ram with nice tight timings" ..............i don't think so. The only thing it will do is make cheap ram, cheaper.

They will displace the RAM cartel from many Chinese products,meaning that they will lose more and more of the market from their biggest customer as time progresses.

 

[kitfit1]

They will displace the RAM cartel from many Chinese products,meaning that they will lose more and more of the market from their biggest customer as time progresses.

Yes, that's true. And hopefully we can all look forward to better ram when they do it.

Honestly if they flood the market with that then at least people can get into the PC market, being able to buy RAM in 2012 for under £30 for 8GB was nuts, if you could do that now for Ryzen people could game (albeit only lightly) for under £200.

Ryzen only benefits from ram running as fast as possible on any individuals rig. Price of it is neither here nor there....................what matters is the speed and timings. A dram newcomer to the market will be years away from being anywhere in the ballpark for that. That said, more competition in any sector is always a good thing for us because it keeps all sectors on there toes

 

[Doogles]

Yes, that's true. And hopefully we can all look forward to better ram when they do it.



Ryzen only benefits from ram running as fast as possible on any individuals rig. Price of it is neither here nor there....................what matters is the speed and timings. A dram newcomer to the market will be years away from being anywhere in the ballpark for that. That said, more competition in any sector is always a good thing for us because it keeps all sectors on there toes

If you can't afford a build with 2x8GB 3200mhz at £150 but can afford Ryzen with 2x8GB at £70 then at least you actually have a Ryzen rig to use. I'm not talking about people with their 2700x I'm talking for those that just want the cheapest APU for playing some Fortnite/CS:GO/War Thunder/Overwatch at 1080p on lowest settings. Sure you'll take a 20% hit in performance because of the cheaper RAM but at least it's something affordable.

 

[LePhuronn]

But it's not just Ryzen though. How many people are prepared to pay Intel's prices for Skylake and beyond but are sitting at Haswell and earlier because DDR4 is stupid money?

I know that I've had to put my modding aspirations on hold for a while because all four key components are ludicrous money right now, but RAM is the worst for me; I can make extensive aesthetic changes to budget motherboards, but I'm not pairing a £70 board with £200 RAM.

 

[markoboyo11]

But it's not just Ryzen though. How many people are prepared to pay Intel's prices for Skylake and beyond but are sitting at Haswell and earlier because DDR4 is stupid money?

I know that I've had to put my modding aspirations on hold for a while because all four key components are ludicrous money right now, but RAM is the worst for me; I can make extensive aesthetic changes to budget motherboards, but I'm not pairing a £70 board with £200 RAM.

Yep I'm one too, eyeing up a 2600 and 450 motherboard build but the ram price is the only thing stopping me.

 

[Devrij]

I'm itching to get onto a new platform from my ivy chip, but like plenty of others I'm holding off until these inflated prices come down. Next year then, hopefully.

 

[Troezar]

I'm thinking 8 core Zen 3 for £300 and 32GB RAM for £150 and £200 for a decent motherboard. £650 all in and that should keep me going for a long time! Have to wait and see what happens to prices.

 

[Sampsy]

Is there any evidence that this is actually happening beyond this analyst report? IIRC Gibbo knew about the RAM shortage before it happened in 2016 - I remember him posting on the forum about it.